Debt does not last forever and therefore our law recognises the principle of prescription, which means that certain debts become legally unenforceable after a specific period of time.

Understanding prescription can protect people from unlawful debt collection and credit enforcement.

What Is Prescription?

Prescription is governed by the Prescription Act 68 of 1969, which regulates when debts prescribe and when prescription may be interrupted.

Prescription refers to the legal process whereby a debt is extinguished after the creditor fails to enforce it within a prescribed period and once a debt has prescribed, the creditor loses the legal right to enforce payment through the court.

How Long Before a Debt Prescribes?

The prescription period depends on the type of debt.

In terms of section 11(d) of the Act, most ordinary debts prescribe after three years, these debts include:

1. Personal loans;
2. Credit cards;
3. Retail accounts;
4. Cellphone contracts;
5. Medical accounts; and
6. Overdraft facilities.

However, some debts prescribe after a longer period of time, these debts include:

1. Certain bills of exchange (which prescribes after 6 years);
2. Judgment debts and certain state debts (which prescribes after 15 years); and
3. Mortgage bonds and certain tax debts (which prescribes after 30 years).

When does prescription start running?

Prescription begins when the debt becomes due, meaning either when payment was required or when the creditor knew (or reasonably should have known) the identity of the debtor and the facts giving rise to the debt.

The Constitutional Court in the case of Makate v Vodacom (Pty) Ltd 2016 (4) SA 121 (CC) confirmed that a debt becomes due when it is immediately claimable.

What Stops Prescription?

Prescription does not continue running if it is interrupted and the most common interruptions include:

1. Making payment toward the debt;
2. A written or verbal acknowledgment of liability;
3. Signing an acknowledgement of debt;
4. Service of a summons by the creditor.

Prescribed debt cannot be collected:

Debt collectors and credit providers may not lawfully enforce prescribed debt and the National Credit Act 34 of 2005 specifically prohibits the re-activation or collection of prescribed debt under credit agreements where the consumer raises prescription as a defence.

Conclusion

Prescription disputes often involve technical legal questions about acknowledgment, service of summons, and calculation of time periods. An attorney can assess whether a debt is legally enforceable and protect you from unlawful collection practices.